THE Australian Government’s Foreign Investment Review Board should have the overriding power to determine the sale of water rights, according to Member for Mallee Anne Webster.
Dr Webster’s comments in Federal Parliament this week followed a public meeting in Mildura, during which irrigators expressed their “anger and distress” at water market workings.
The Mildura public hearing was told that in the worst of the recent drought, the price of temporary water was up to about $900 a megalitre.
The Australian Competition and Consumer Commission (ACCC) is conducting an inquiry into markets for tradeable water rights in the Murray-Darling Basin and held public hearings in regional towns and communities to hear the views of those engaged in and affected by water markets.
Dr Webster said the role played by speculators and foreign investment in the market were key issues at the Mildura hearing.
“I know that this was a charged meeting, with many expressing their anger and distress at the operation of the markets,” Dr Webster said.
“The attendees also lamented the view that their voices were not being heard.”
However, Dr Webster said the government was listening to community concerns about water markets and water trading and was working through the complexities.
“There is a widely held view that these markets are exploited by local and foreign speculators, who have played a role in artificial price increases in temporary water prices,” she said.
“I have also heard numerous calls from concerned communities requesting that access to these markets be restricted only to those who have productive use of water.
“Players without a productive use for water add yet another straw to a diminishing cup, driving up scarcity in the market.”
Dr Webster said that while she supported water trade associated with productivity, she was sensitive to the fact that annual croppers traded water in dry years as part of their business model when they could not sow.
“There are also retired farmers who rely on water trade as their self-funded retirement system,” she said.
“These complexities need to be acknowledged and managed.
“While acknowledging the value and contribution of foreign investment to our national prosperity, it is important to strike a balance between maintaining an attractive and welcoming environment for foreign capital on the one hand while maintaining community confidence in the foreign investment regime on the other.”
The ACCC is expected to recommend options to enhance markets for tradeable water rights, including options to enhance their operations, transparency, regulation, competitiveness and efficiency.
Dr Webster said it would be prudent for Minister for Resources, Water and Northern Australia Keith Pitt to await the commission’s findings before taking action on water markets.
“Based on the work I have done with members of the Mallee community, expert water management bodies and Minister Pitt, I’m of the opinion that the sale of water rights should be subject to approval by the Foreign Investment Review Board,” Dr Webster said.
“This will ensure that Australian farming communities have confidence that rules are in place to protect their livelihoods.
“We owe it to our farmers, irrigators and drought-affected communities to restore confidence in the complex system that governs the management of Australia’s water resources.”
